An employment agreement usually contains the main terms of employment such as the salary and allowances, working hours and location, and other employee benefits. This article discusses five clauses that you can also consider including in your employment agreement (if they are not already there):

  1. Flexible Working Arrangements: With the rise of remote work and hybrid models, it is crucial to address flexible working arrangements in your employment agreement. Clearly define the boundaries, extent, and regulations regarding working from home or flexible working hours to ensure employee productivity and protect work confidentiality. Specify any expectations or limitations, such as required office attendance or specific hours of availability.
  2. Data Security or Confidentiality: Given the increased use of technology, data security or confidentiality clauses are crucial in employment contracts. The data security clause outlines how the employer will protect personal information and data. The confidentiality clause prohibits employees from disclosing confidential information about the company, clients, or products. Ensure clarity on what information is considered confidential and the consequences of violating this clause. 
  3. Anti-Discrimination and Equal Opportunity: Incorporate a clause that prohibits discrimination, and sets out the company’s commitment to providing equal opportunities for all employees. This clause can outline a zero-tolerance approach to discrimination based on protected characteristics such as race, gender, age, religion, disability, or sexual orientation. An employer can also provide reasonable accommodations for employees with disabilities, to promote diversity and inclusion.
  4. Conflict of Interest and Outside Business Ventures: Define any restrictions or obligations related to the employee’s involvement in outside business ventures or entrepreneurial activities. In the current economy, many employees may not see the harm with taking a second job or participating in gig work. Therefore, this clause is crucial to address concerns about conflicts of interest, non-competition and the duty of fidelity.
  5. Anti-Harassment and Bullying: Employers should consider including a clause that prohibits harassment and bullying. If not already included in the employment handbook or in other policies, this clause can also outline the reporting procedures, investigation process, and disciplinary actions that will be taken in case of a harassment or bullying complaint. 

While an employment agreement typically covers the essential terms of employment, it is important to consider including additional clauses that address the evolving needs and concerns of both employers and employees. The five clauses discussed in this article can enhance the agreement by promoting productivity, protecting sensitive information, fostering inclusivity, preventing conflicts of interest, and ensuring a safe working environment. 

By carefully crafting an employment agreement that incorporates these clauses, both employers and employees can benefit from greater clarity, fairness, and alignment in their professional relationships. Do remember to always consult with legal professionals to ensure compliance with relevant laws and regulations when drafting these clauses.

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This article was written by Zi-Han, Lim (Senior Associate) from Donovan & Ho’s employment law practice. 

Donovan & Ho is a law firm in Malaysia, and our employment practice group has built a reputation for providing strategic employment advice to local and global organisations.  Our team of employment lawyers provide advice on employment law and industrial relations including review of employment contracts, policies and handbooks, advising on workforce reductions, and managing dismissals of employees for poor performance or misconduct. We also represent clients in unfair dismissal claims and employment-related litigation. Have a question? Please contact us.

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